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Audit 35994

FY End
2022-06-30
Total Expended
$3.78M
Findings
6
Programs
3
Organization: Local Area of the Workforce Development in the Northwest (PR)
Year: 2022 Accepted: 2023-03-12
Auditor: CPA Diaz Martinez Psc

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
37141 2022-001 Significant Deficiency Yes G
37142 2022-001 Significant Deficiency Yes G
37143 2022-001 Significant Deficiency Yes G
613583 2022-001 Significant Deficiency Yes G
613584 2022-001 Significant Deficiency Yes G
613585 2022-001 Significant Deficiency Yes G

Programs

ALN Program Spent Major Findings
17.278 Wia Dislocated Worker Formula Grants $1.78M Yes 1
17.258 Wia Adult Program $1.17M Yes 1
17.259 Wia Youth Activities $830,300 Yes 1

Contacts

Name Title Type
ENA2HG7HR5L7 Lourdes Rios Muniz Auditee
7878191501 Jose Ernesto Diaz Martinez Auditor
No contacts on file

Notes to SEFA

Title: GENERAL Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Suchexpenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain typesof expenditures are not allowable or are limited as to reimbursement.A. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal courseof business to amounts reported as expenditures in prior years.B. Pass-through entity identifying numbers are presented where available.C. The Local Area has elected not to use the 10 percent de minimis indirect cost rate allowed under the UniformGuidance De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of the LocalArea of Workforce Development in the Northwest (Local Area) under programs of the federal government for thefiscal year ended June 30, 2022. The information in this Schedule is presented in accordance with therequirements of Title 2 U.S. Code of Federal Regulations Part 200, (Uniform Guidance). Because the Schedulepresents only a selected portion of the operations of the Local Area, it is not intended to and does not present thefinancial position, changes in net position, or cash flows of the Local Area.
Title: FEDERAL ASSISTANCE LISTING NUMBER Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Suchexpenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain typesof expenditures are not allowable or are limited as to reimbursement.A. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal courseof business to amounts reported as expenditures in prior years.B. Pass-through entity identifying numbers are presented where available.C. The Local Area has elected not to use the 10 percent de minimis indirect cost rate allowed under the UniformGuidance De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Assistance Listing Number, formerly known as the Catalog of Federal Domestic Assistance (CFDA) Number,is a five-digit number assigned in the awarding document for all Federal assistance award mechanisms, includingFederal grants and cooperative agreements
Title: RELATIONSHIPS TO FEDERAL FINANCIAL REPORTS Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Suchexpenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain typesof expenditures are not allowable or are limited as to reimbursement.A. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal courseof business to amounts reported as expenditures in prior years.B. Pass-through entity identifying numbers are presented where available.C. The Local Area has elected not to use the 10 percent de minimis indirect cost rate allowed under the UniformGuidance De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Expenditures of Federal awards reported in the Local Area's Statement of Activities and Governmental FundsStatement of Revenues, Expenditures and Changes in Fund Balances differed with those reported to Federalagency. During the fiscal year 2021-2022, the Local Area received the amount of $1,882, from program income,which was used against eligible expenditures under the WIOA Act.

Finding Details

Finding 2022-001
FINDING REFERENCE NUMBER 2022-001 FEDERAL PROGRAM (ALN 17.258, 17.259 AND 17.278) WORKFORCE INNOVATION AND OPPORTUNITY ACT (WIOA) (CLUSTER) PASS-THROUGH ? ECONOMIC DEVELOPMENT AND COMMERCE DEPARTMENT OF THE COMMONWEALTH OF PUERTO RICO U.S. DEPARTMENT OF LABOR AWARD NUMBER 2021-0000013 COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA WOIA Youth Activities required that not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510). Also, a minimum of 75 percent of the Youth Activity funds allocated to States and local areas, except for the local area expenditures for administration, must be used to provide services to Out-of-School youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506). STATEMENT OF CONDITION During our audits test of the earmarking compliance requirement for the Youth Program funds of the program year 2020-2021, we noted that the Local Area only expended 2% of the funds allocated to programmatic activities on paid and unpaid work experiences at the end of the two years of funds availability which ended June 30, 2022. Also, the Local Area only expended 22% of the Youth Program funds allocated for program year 2020-2021 on services for Out-of-School. QUESTIONED COSTS None PERSPECTIVE INFORMATION This is a repeated finding and includes two earmarking requirements. This represents a systematic problem per our evaluation. (The sampling was a statistically valid sample.) STATEMENT OF CAUSE The Local Area fail to timely identify the lack of compliance with the earmarking requirement for the Youth Program and failed to planned activities for participants related to paid and unpaid work experience and activities for Out-of-School Youth during the two years of funds availability. POSSIBLE ASSERTED EFFECT The Local Area failed to comply with a programmatic requirement of the Youth Program. IDENTIFICATION OF REPEAT FINDING Repeat Finding ? Prior year Finding Number 2021-001. RECOMMENDATIONS We recommend that a formal monitoring of the earmark requirements for the Youth Program, as well as other earmark requirements, takes place at least on a quarterly basis during the funds period of performance. Staff that should participate on the monitoring include finance, planning, youth program staff and executive staff. If deviations or failure to meet the earmark are noted, communications must be generated to the youth program staff in order to take corrective actions before the elapse of the funding period.
Finding 2022-001
FINDING REFERENCE NUMBER 2022-001 FEDERAL PROGRAM (ALN 17.258, 17.259 AND 17.278) WORKFORCE INNOVATION AND OPPORTUNITY ACT (WIOA) (CLUSTER) PASS-THROUGH ? ECONOMIC DEVELOPMENT AND COMMERCE DEPARTMENT OF THE COMMONWEALTH OF PUERTO RICO U.S. DEPARTMENT OF LABOR AWARD NUMBER 2021-0000013 COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA WOIA Youth Activities required that not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510). Also, a minimum of 75 percent of the Youth Activity funds allocated to States and local areas, except for the local area expenditures for administration, must be used to provide services to Out-of-School youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506). STATEMENT OF CONDITION During our audits test of the earmarking compliance requirement for the Youth Program funds of the program year 2020-2021, we noted that the Local Area only expended 2% of the funds allocated to programmatic activities on paid and unpaid work experiences at the end of the two years of funds availability which ended June 30, 2022. Also, the Local Area only expended 22% of the Youth Program funds allocated for program year 2020-2021 on services for Out-of-School. QUESTIONED COSTS None PERSPECTIVE INFORMATION This is a repeated finding and includes two earmarking requirements. This represents a systematic problem per our evaluation. (The sampling was a statistically valid sample.) STATEMENT OF CAUSE The Local Area fail to timely identify the lack of compliance with the earmarking requirement for the Youth Program and failed to planned activities for participants related to paid and unpaid work experience and activities for Out-of-School Youth during the two years of funds availability. POSSIBLE ASSERTED EFFECT The Local Area failed to comply with a programmatic requirement of the Youth Program. IDENTIFICATION OF REPEAT FINDING Repeat Finding ? Prior year Finding Number 2021-001. RECOMMENDATIONS We recommend that a formal monitoring of the earmark requirements for the Youth Program, as well as other earmark requirements, takes place at least on a quarterly basis during the funds period of performance. Staff that should participate on the monitoring include finance, planning, youth program staff and executive staff. If deviations or failure to meet the earmark are noted, communications must be generated to the youth program staff in order to take corrective actions before the elapse of the funding period.
Finding 2022-001
FINDING REFERENCE NUMBER 2022-001 FEDERAL PROGRAM (ALN 17.258, 17.259 AND 17.278) WORKFORCE INNOVATION AND OPPORTUNITY ACT (WIOA) (CLUSTER) PASS-THROUGH ? ECONOMIC DEVELOPMENT AND COMMERCE DEPARTMENT OF THE COMMONWEALTH OF PUERTO RICO U.S. DEPARTMENT OF LABOR AWARD NUMBER 2021-0000013 COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA WOIA Youth Activities required that not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510). Also, a minimum of 75 percent of the Youth Activity funds allocated to States and local areas, except for the local area expenditures for administration, must be used to provide services to Out-of-School youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506). STATEMENT OF CONDITION During our audits test of the earmarking compliance requirement for the Youth Program funds of the program year 2020-2021, we noted that the Local Area only expended 2% of the funds allocated to programmatic activities on paid and unpaid work experiences at the end of the two years of funds availability which ended June 30, 2022. Also, the Local Area only expended 22% of the Youth Program funds allocated for program year 2020-2021 on services for Out-of-School. QUESTIONED COSTS None PERSPECTIVE INFORMATION This is a repeated finding and includes two earmarking requirements. This represents a systematic problem per our evaluation. (The sampling was a statistically valid sample.) STATEMENT OF CAUSE The Local Area fail to timely identify the lack of compliance with the earmarking requirement for the Youth Program and failed to planned activities for participants related to paid and unpaid work experience and activities for Out-of-School Youth during the two years of funds availability. POSSIBLE ASSERTED EFFECT The Local Area failed to comply with a programmatic requirement of the Youth Program. IDENTIFICATION OF REPEAT FINDING Repeat Finding ? Prior year Finding Number 2021-001. RECOMMENDATIONS We recommend that a formal monitoring of the earmark requirements for the Youth Program, as well as other earmark requirements, takes place at least on a quarterly basis during the funds period of performance. Staff that should participate on the monitoring include finance, planning, youth program staff and executive staff. If deviations or failure to meet the earmark are noted, communications must be generated to the youth program staff in order to take corrective actions before the elapse of the funding period.
Finding 2022-001
FINDING REFERENCE NUMBER 2022-001 FEDERAL PROGRAM (ALN 17.258, 17.259 AND 17.278) WORKFORCE INNOVATION AND OPPORTUNITY ACT (WIOA) (CLUSTER) PASS-THROUGH ? ECONOMIC DEVELOPMENT AND COMMERCE DEPARTMENT OF THE COMMONWEALTH OF PUERTO RICO U.S. DEPARTMENT OF LABOR AWARD NUMBER 2021-0000013 COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA WOIA Youth Activities required that not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510). Also, a minimum of 75 percent of the Youth Activity funds allocated to States and local areas, except for the local area expenditures for administration, must be used to provide services to Out-of-School youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506). STATEMENT OF CONDITION During our audits test of the earmarking compliance requirement for the Youth Program funds of the program year 2020-2021, we noted that the Local Area only expended 2% of the funds allocated to programmatic activities on paid and unpaid work experiences at the end of the two years of funds availability which ended June 30, 2022. Also, the Local Area only expended 22% of the Youth Program funds allocated for program year 2020-2021 on services for Out-of-School. QUESTIONED COSTS None PERSPECTIVE INFORMATION This is a repeated finding and includes two earmarking requirements. This represents a systematic problem per our evaluation. (The sampling was a statistically valid sample.) STATEMENT OF CAUSE The Local Area fail to timely identify the lack of compliance with the earmarking requirement for the Youth Program and failed to planned activities for participants related to paid and unpaid work experience and activities for Out-of-School Youth during the two years of funds availability. POSSIBLE ASSERTED EFFECT The Local Area failed to comply with a programmatic requirement of the Youth Program. IDENTIFICATION OF REPEAT FINDING Repeat Finding ? Prior year Finding Number 2021-001. RECOMMENDATIONS We recommend that a formal monitoring of the earmark requirements for the Youth Program, as well as other earmark requirements, takes place at least on a quarterly basis during the funds period of performance. Staff that should participate on the monitoring include finance, planning, youth program staff and executive staff. If deviations or failure to meet the earmark are noted, communications must be generated to the youth program staff in order to take corrective actions before the elapse of the funding period.
Finding 2022-001
FINDING REFERENCE NUMBER 2022-001 FEDERAL PROGRAM (ALN 17.258, 17.259 AND 17.278) WORKFORCE INNOVATION AND OPPORTUNITY ACT (WIOA) (CLUSTER) PASS-THROUGH ? ECONOMIC DEVELOPMENT AND COMMERCE DEPARTMENT OF THE COMMONWEALTH OF PUERTO RICO U.S. DEPARTMENT OF LABOR AWARD NUMBER 2021-0000013 COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA WOIA Youth Activities required that not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510). Also, a minimum of 75 percent of the Youth Activity funds allocated to States and local areas, except for the local area expenditures for administration, must be used to provide services to Out-of-School youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506). STATEMENT OF CONDITION During our audits test of the earmarking compliance requirement for the Youth Program funds of the program year 2020-2021, we noted that the Local Area only expended 2% of the funds allocated to programmatic activities on paid and unpaid work experiences at the end of the two years of funds availability which ended June 30, 2022. Also, the Local Area only expended 22% of the Youth Program funds allocated for program year 2020-2021 on services for Out-of-School. QUESTIONED COSTS None PERSPECTIVE INFORMATION This is a repeated finding and includes two earmarking requirements. This represents a systematic problem per our evaluation. (The sampling was a statistically valid sample.) STATEMENT OF CAUSE The Local Area fail to timely identify the lack of compliance with the earmarking requirement for the Youth Program and failed to planned activities for participants related to paid and unpaid work experience and activities for Out-of-School Youth during the two years of funds availability. POSSIBLE ASSERTED EFFECT The Local Area failed to comply with a programmatic requirement of the Youth Program. IDENTIFICATION OF REPEAT FINDING Repeat Finding ? Prior year Finding Number 2021-001. RECOMMENDATIONS We recommend that a formal monitoring of the earmark requirements for the Youth Program, as well as other earmark requirements, takes place at least on a quarterly basis during the funds period of performance. Staff that should participate on the monitoring include finance, planning, youth program staff and executive staff. If deviations or failure to meet the earmark are noted, communications must be generated to the youth program staff in order to take corrective actions before the elapse of the funding period.
Finding 2022-001
FINDING REFERENCE NUMBER 2022-001 FEDERAL PROGRAM (ALN 17.258, 17.259 AND 17.278) WORKFORCE INNOVATION AND OPPORTUNITY ACT (WIOA) (CLUSTER) PASS-THROUGH ? ECONOMIC DEVELOPMENT AND COMMERCE DEPARTMENT OF THE COMMONWEALTH OF PUERTO RICO U.S. DEPARTMENT OF LABOR AWARD NUMBER 2021-0000013 COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA WOIA Youth Activities required that not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510). Also, a minimum of 75 percent of the Youth Activity funds allocated to States and local areas, except for the local area expenditures for administration, must be used to provide services to Out-of-School youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506). STATEMENT OF CONDITION During our audits test of the earmarking compliance requirement for the Youth Program funds of the program year 2020-2021, we noted that the Local Area only expended 2% of the funds allocated to programmatic activities on paid and unpaid work experiences at the end of the two years of funds availability which ended June 30, 2022. Also, the Local Area only expended 22% of the Youth Program funds allocated for program year 2020-2021 on services for Out-of-School. QUESTIONED COSTS None PERSPECTIVE INFORMATION This is a repeated finding and includes two earmarking requirements. This represents a systematic problem per our evaluation. (The sampling was a statistically valid sample.) STATEMENT OF CAUSE The Local Area fail to timely identify the lack of compliance with the earmarking requirement for the Youth Program and failed to planned activities for participants related to paid and unpaid work experience and activities for Out-of-School Youth during the two years of funds availability. POSSIBLE ASSERTED EFFECT The Local Area failed to comply with a programmatic requirement of the Youth Program. IDENTIFICATION OF REPEAT FINDING Repeat Finding ? Prior year Finding Number 2021-001. RECOMMENDATIONS We recommend that a formal monitoring of the earmark requirements for the Youth Program, as well as other earmark requirements, takes place at least on a quarterly basis during the funds period of performance. Staff that should participate on the monitoring include finance, planning, youth program staff and executive staff. If deviations or failure to meet the earmark are noted, communications must be generated to the youth program staff in order to take corrective actions before the elapse of the funding period.